Tuesday, November 11, 2008

CFO thought: now is the time to watch your receivables like a hawk. When corporate finances are tight, it is time to begin paying with a slow hand; or better, time to slow payments to vendors and step up receivables collection.

This brings up a perplexing problem: how can one expect others to pay timely and yet to pay slow himself?

The answer is the squeaky wheel. When you slow payables maybe 30-40% of your vendors will be on top of their game and contact you for payment. That means 60% will accept the slow payment terms.

If you are a fast tracker on receivables, you will be one of the 30-40% looking for collections in a timely, aggressive manner. End results, you win the temporary cash flow game. The big question is how focused is management on being in the 30-40% gainers?

Golden Rule for any sustainable success story is disciplined, focused action in four areas - in good times and in bad:

Revenue Growth

Cost Control

Enhancement of Profit

Increases in Cash Flow.

The companies that focus management effort in these areas are truly successful long term.

The Angelus

Pray faithfully.

Praise

"To praise you is the desire of man, a little piece of your creation. You stir man to take pleasure in praising you, because you have made us for yourself, and our heart is restless until it rests in you . . . Ah, my lord, you are the one true and good lord of your land, which is my heart." - St. Augustine of Hippo

"Wisdom enters through love, silence, and mortification. It is great wisdom to know how to be silent and to look at neither the remarks, nor the deeds, nor the lives of others." - St. John of the Cross